Pollice Verso: GAO Gives Agency’s Overly-Punctilious Misreading of Proposal a Thumbs Down; Knight Point Systems, LLC, GAO B-418746


Protest challenging agency’s decision to exclude offeror from the competition is sustained. The agency contended that it excluded the protester’s proposal because it could not discern the identity of the quoting entity. GAO, however, found that taken as whole, the proposal sufficiently set forth the identity of the prime contractor. To be sure, the proposal made numerous references to the protester’s parent company. But the cover letter to the proposal had explained that the names of the protester and its parent were used interchangeably. Indeed, the protester had further explained its relationship with the parent company in clarifications with the agency.

The U.S. Coast Guard issued an RFQ to vendors holding a GSA FSS contract under the information technology schedule. The RFQ contemplated the establishment of two blanket purchase agreements.

Knight Point Systems, LLC submitted a quote. The cover letter of the quote was on the letterhead of Perspecta, Inc. But the cover letter stated that Perspecta was submitting the quote through its bidding entity, Knight Point. Although the Perspecta name was used throughout the quote, the cover letter stated that the name was interchangeable with the legal bidding entity, Knight Point. The cover letter further identified Knight Point as the prime contractor and included a single DUNS number and CAGE code for Knight Point.

The contracting officer sent a letter Knight Point seeking clarification on the company’s relationship with Perspecta. The letter asked whether the Knight Point and Perspecta were independent entities.

In response, Knight Point explained Perspecta had just recently acquired Knight Point. Still, Knight Point was the bidding entity, and Perspecta was its parent company. Nevertheless, Knight Point stated that the acquisition had enhanced its and offerings, and to demonstrate that it could provide a full suite of capabilities, Knight Point’s prior experience citations across the entire Perspecta enterprise. The letter further stated that Knight Point would likely change its name in the near future to conform to the Perspecta brand.

After the reviewing the letter, the contracting officer determined that Perspecta, rather than Knight Point, had submitted the quote. The contracting officer noted that the majority of the quote used the Perspecta name. The quote’s small business plan had been submitted by Perspecta and the citations were submitted as Perspecta experience. Believing that the quote did not clearly identify the quoting entity, the contracting officer excluded the Knight Point/Perspecta quote from further consideration.

GAO found the decision to exclude the quote was unreasonable. The Coast Guard claimed that a provision in the RFQ precluded any other entity other than the prime contractor from contributing information for the quote. That provision stated that the “government will review the quote to ensure that all require volumes/information have been included . .  if [the] prime contractor does not submit all the volumes/information . . . the prime vendor’s submission may be rejected.” GAO disagreed with the Coast Guard’s interpretation of this provision. The provision was clearly focused on the completeness of the information submitted; it did not preclude entities other than the prime contractor from contributing information. The Coast Guard had thus excluded the proposal based on considerations not contemplated by the solicitation’s requirements.

Additionally, GAO found that the record failed to support the Coast Guard’s conclusions that the small business plan had been submitted by Perspecta. The plan had stated that it was submitted by a large business. The Coast Guard had assumed the large business must have been Perspecta because Knight Point was a small business. But the Coast Guard overlooked the fact that light of its acquisition by Perspecta, Knight Point was no longer a small business.

GAO also determined that the Coast Guard had erred in determining that all the prior examples in the quote were from Perspecta. In its response to the agency’s inquiry, Knight Point had clarified that its examples were performed by itself and another company, and that both were Perspecta subsidiaries. In light of this clarification, GAO found that the agency’s conclusion that Perspecta performed the examples was unreasonable.

Lastly, GAO was not persuaded that use of the Perspecta name throughout the quote meant that the quote was submitted by Perspecta. The cover letter to the quote clearly advised that the Perspecta name used in the proposal was interchangeable with Knight Point. What’s more, Knight Point’s response the agency’s inquire had further explained that the companies shared an identity. GAO found that the quote as a whole sufficiently identified the relationship between the two entities.

Knight Point is represented by Daniel R. Forman, Robert J. Sneckenberg, and Gabrielle D. Trujillo of Crowell & Moring LLP. The agency is represented by Shandra J. Kotzun of the Department of Homeland Security. GAO attorneys Heather Weiner and Jennifer Westfall-McGrail participated in the preparation of the decision.

Knight Point Systems